Bill Cullen - a living God, or a jumped up car salesman ?

Frontline 22/02/10

The topic of discussion was the current economic crisis and disaffected youth. Among the gurus of the current world order in attendance was one Bill Cullen - a multi millionaire from humble origins who clawed his way into the ranks of Ireland's financial oligarchy. Cullen went on a rather stereotypical tirade about how the youth of today where lazy and spoilt, followed by a rant about how his days of hardship had thought him a thing or two about the value of ''hard work''. http://www.youtube.com/watch?v=Xe1a1wHxTyo. Nor was he happy with people playing ''the blame game'' - complaining about Fianna Fail, the banks ect. This is understandable considering Cullen's (Glencullen Holdings) made €13,459 of political donations in 2002. Glencullen Distributors donated an additional €2,500 to Mary Hanafin (FF) in 2007.

One of the most shocking comments made by Cullen was that young people should be ''happy to work for nothing'' - in order to gain experience. Needless to say, Bills desire to see Ireland's youth engage in slave labor was hardly self disinterested. Cullen is a capitalist, and as such embodies a philosophy marked by a pathological urge to drive down labor costs so as to ascertain higher profits. Far from being a good Samaritan, Cullen is a greedy old man who wants more money at the expense of other people. His prognosis of Ireland's social ills cannot be separated from his own economic agenda.

One member of the audience made a statement in relation to wealth re-distribution to which Cullen was offended. Cullen responded by asserting that he had worked hard for the wealth in his possession, and re-distribution would only serve to penalize his efforts. The underlying assumption is of course that his wealth can be connected to ''his'' efforts. The notion that his companies $350m a year turnover can be attributed to his individual workload is nonsensical. Cullen has merely ascertained a position whereby he is able to make other people work for him, and as a consequence appropriate a large slice of the value that his employees generate. Cullen ''built'' the Glencullen enterprise in much the same sense as the Pharaoh's ''built'' the pyramids. To say that he ''or those like him'' create wealth is little more than a euphemism used to describe the process of speculative appropriation.

Amazingly some of those at the butt end of Bills abuse agreed with his general prescription, one commenting that ''bill is right, we do need a kick up the arse''. Well, if you accept Bills worldview then this might be the case - bend over and let him kick you. Socialists on the other hand understand very well that while kicks up the arse are in dire need of administration, those on low incomes have been kicked just about enough.

History, Propaganda and Hypocrisy

Among the most cherished rhetorical devices of contemporary right wing propaganda is the assertion that ''socialism has failed'', due to the experience of USSR style command economies. This assertion is most often conveyed via the illustration of of soviet atrocities. The underlying implication is that command economies developed through exponential suffering relative to their liberal counterparts. How realistic is this argument ?. Is communism quantifiably worse than capitalism ?. It seems counterintuitive to think otherwise in a society where we have become so accustomed to a one sided interpretation of history, however the facts provide an interesting counter-narrative.

In terms of human cost - communism is often said to have killed millions, statistics vary from source to source. Lets take one of the most damming condemnations of communism to date - the estimate provided in the ''Black Book Of Communism'' - (a favorite among neo-liberals). The Black Book puts the death toll at 100 million. It could reasonably be argued that the methodology employed by the Black Books authors is flawed - (For instance the 5000 people murdered in the Bulgarian White Terror. 15,000 in the German anti-communist purges. 6000 people in the anti communist Hungarian terror, 70,000 sent to concentration camps. 11,783 in the Finish Terror with 80,000 sent to concentration camps ect, are all ironically attributed to ''communism''. It also factors in all deaths caused by the US invasion of Vietnam ect. However lets just assume that the figure is accurate.

In his compilation - propaganda and the public mind, political theorist Noam Chomsky deals the above argument a devastating blow. Drawing on statistics provided by Nobel laureate in economics Amartya Sen - he notes that in India alone, the "democratic capitalist experiment" 1947-1979 has caused in excess of 100 million deaths due to famine. Chomsky points out that this figure is higher than the entire history of ''Communism'' everywhere - even compared to the exaggerated statistics provided by ''the black book''. Well, that's just India in the space of three decades. All of sudden the expression ''don't throw stones in glasshouses'' comes to mind. To factor in the deaths caused by European imperialism, the industrial revolution, the extermination of the native Americans (exceeding the number killed in the holocaust according to historian David Cesarani) - would prove quite a task. It begins to become apparent that the while the death toll from states designated as communist is quite high, the death toll of capitalist regimes if calculated would be much higher.

Numerous objections could be leveled against the above argument. Possibly contesting that capitalism isn't actually a single system, according to some there are ''numerous capitalism's''. Proponents of the notion that different capitalist systems have existed throughout history very often support their case by recourse to observation of mercantile practices under prior modes of economic organization. I will deal with the difference between capitalism, and prior economic systems (with capitalist characteristics) in another post.

Capitalism is a singular socio-economic model, nation states regulate the process of exchange in different ways, however the fundamental characteristics of the economic structure are the same. Furthermore, each national economy is tied into a globalized capitalist framework. Can the same rationale be applied to communism?. Can variations of communism be described as being part of the same basic model, in the same way as neo-liberalism and keynesianism are understood as being part of capitalism ?. This depends, for example the Chinese system under Mao was in many ways different from the Russian system under Khrushchev, however both sets of policy where predicated upon a standard centralized command model. Likewise Reagan's policy and Roosevelt's policy although quite different, rested upon the same economic structure. Libertarian and collectivist forms of socialism on the other hand advocate an entirely different economic framework, as such they cannot be understood as variants of command communism.

Another objection could be that its disingenuous to attribute deaths caused by famine to capitalism - well, if that's the case then the liberal condemnation of famine under communist regimes needs to be revised. The imperial acquisition, narco trafficking and slavery that funded the industrial revolution are much a part of capitalism as the famine caused by Maos policies are part of ''communism''.

History presents a complex version of events, state capitalism/state communism being guilty of many of the same crimes, conservatives who point to ''communist states'' as an example of social oppression very often do so under the illusion that ''capitalist states'' developed along a more humane trajectory.

George Lee, The Man, The Myth, The Legend

Looking at frontline on feb 8th, while the show was initially supposed to have been about social welfare - it was rescheduled in line with the resignation of George lee. I was struck by the significance given to this mans affairs, media frenzy - and for what ?. I suppose its indicative of celebrity culture, next thing hel be staring in his own reality TV show.

One of things I noticed pretty quickly was that despite the sympathy this man seemed to generate amongst the audience, he wasn't presenting his political views. Whenever Lee was asked about his economic/political trajectory he would respond with a flurry of rhetoric about how Ireland had lost its way and required (strong leadership). Lee would talk about ''the need to get people back to work'' and lack of vision on the part of the political establishment ect. Later that night Lee appeared on Vincent Brown where he received a scalding inquisition at the behest of the great cynic. Brown was Intent on exposing Lees political ideology but to no avail. Lee like all good neo-liberal economists asserted (as he had been trained to do as an undergraduate) that he was ''value free'' - didn't believe in ideology, and considered himself a pragamtist. Along the way Lee made comments expressing his wish to see the poorest in society protected ect. Needless to say, all die hard right wing liberals want to protect the poor, so long as its not at the expense of the rich.

So who is George Lee ? Well, he graduated from UCD, after having studied economics under the late Brendan Walsh - the man who called for a statutory limit on irish borrowing during the 1980s, he was a staunch proponent of low income tax and deregulated labour markets. Lee was most likely entrenched in neo-classical liberal orthodoxy from the moment he stepped foot inside UCDs gates. He studied in a time defined by the monetarist ascendancy and collapse of the berlin wall. Later Lee would go on to work in the financial markets, acting as a Senior Economist with Riada Stockbrokers - an organization that among things, deals in debt exchange. After this he worked with the Central Bank of Ireland - before joining RTE in 1992. His productions included two interesting features, George Lee in China - and - The Fall of the Berlin Wall. Both documentaries provided revisionist interpretations of history and bias conceptions of contemporary events. The primary undertone was however, unmistakable ie. (liberal capitalism has triumphed, everything else has failed - history has ended). It was a telling contrast, that in a time marked by capitalist crisis Lee was making productions built around themes considered central to the ''fall of communism''. Self re-assurance ? who knows.

Unfortunately for Lee, his depiction of Germany as having overcome the evil socialist scourge and walking happily into a reaganite utopia was crushed, when in September 2009, the year after he had finished his production - Die Linke (an anti capitalist socialist party) took 11.9% in the federal election. Virtually every constituency in Eastern Berlin was taken by Die Linke, the area Lee had been filming the year prior, with his smug remarks about the popular embrace of capitalist values among modern residents.




Back in Ireland, Lee upon being accepted into Fianna Gael had outlined some of his economic proposals - they included the privatization of state companies like Bord Gais and the ESB. He also remarked that he''would overhaul the massive public sector quangos like the HSE, CIE and FAS and expose them to more competition in order to deliver vital health, transport and training services more effectively and at less cost to the taxpayer'', In other words - Lee's prescription to the current crisis was to sell off public assets to private holders. Two birds with one stone from Lee's perspective considering 1. it would alleviate the wealthy (his supporters) of a substantial tax burden and 2. further ensure public dependence on private services. His claim that increased private control would result in a lower cost to the taxpayer was nonsensical - privatization invariably results in higher costs. It would be true to say those on high incomes would be spared a deal of taxation under Lee's imagined regime - however the vast majority of working people would need to pay more in terms of higher prices.

So thats it, George Lee was a neo-liberal who joined a neo-liberal party, he left - who cares why. The idea that Lee was bringing something new to the political establishment was nonsense. Neo-classical psudeo scientists (economists) exist in abundance within Fianna Gael, Lee must have thought he was special. Not to worry though - he will most likely be given a position in RTE on around five times the average industrial wage, Im sure hel be feeling better in no time.

Capitalism, Marx and the Mechanics of Crisis

Examining the historic course of the market, we see the initial phase of mass industrial development cumulating in a global crisis in the 1930s - with the problem of overproduction caused by a decrease in the rate of industrial profits. To understand why capitalism falls into depression, we should look to Das Kapital. Marx in his main work identified what he called (the tendency of the rate of profit to fall) as being central to the expansionary dynamic of the capitalist system - it is both the cause of periodic crisis and main agent of growth.

First highlighted in capital volume 3, he notes ''the gradual growth of constant capital in relation to variable capital must necessarily lead to a gradual fall of the general rate of profit, so long as the rate of surplus-value, or the intensity of exploitation of labor by capital, remain the same.'' Marx 1894. In other words, capitalists through the process of competition are required to invest ever higher amounts in the technological upgrade of their productive facilities, as a consequence of this increased expenditure they see an overall reduction in the rate of returns - so long as the rate of production/cost of labor remains stable. In order to overcome this problem capitalists may place downward pressure on the social wage or seek cheaper labor markets/resources to exploit through expansion. The former strategy generally leads to a decline in aggregate demand thereby exasperating the situation; the later provides a more steady solution - if entirely temporary.

This is precisely what occurred during the great depression. The US had undergone a reduction of 40% in its rate of profit between the 1880s and the 1920s proceeding the great depression. ''Real wages only rose 6.1% between 1922-1929. The discrepancy was greatest in 1928 and 1929, with output rising three times faster than consumption.'' Harmen (2009). Demand fell relative to supply and crisis of overproduction/underconsumption ensued, food/goods where allowed rot while millions of workers stood idle alongside unemployed capital. Demand in the real sense of the word existed of course - people straving and exhibited high demand for food, however in economic terms there was no ''demand'' considering people where unable to purchase.

In the end the US offset the crisis through the initiation of stimulis, large public works programs where enacted - the aim was to create jobs so as to increase the amount of money in circulation. The main objective was to encourage consumer spending so as to sure up investment in productive enterprise. These policies where enacted as part of Roosevelts - New Deal. Rather than attempting to close the deficit - and deflate the economy, it was decided to drasticly increase spending. It did, for a time offset crisis and generate massive growth.



The problem again emerged in the late 70s, however rather than alleviate the crisis through fiscal expansion another tactic was enacted, namely the transfer of investment from industry to finance, conjoined with a large scale assault upon organized labor. In the case of US finance, Harvey notes ''The total daily turnover of financial transactions in international markets, which stood at $2.3 billion in 1983, had risen to $130 billion by 2001. The $40 trillion turnover in 2001 compares to the estimated $800 billion that would be required to support international trade and productive investment flows'' Harvey p.161 (2005). Allen summarizes how this led to a partial recovery, considering that ''In the US, the rate of profit rebounded by 3.6% between 1979 and 1997, after it had fallen 5.4% from 1966-1979, Fred Morseley calculated that it had recovered about 40% of its earlier decline'' Allen p.101 (2008). Downward pressure was also placed upon wages within the industrialized world, so for example in the US ''Since 1973 total productive growth has risen by 83% while the overall compensation package for workers rose only by 9%'' Allen p.99 (2008).

Decrease in the rate of profit - offset through the de-regulation of the Regan era which opened up new sources of accumulation and supressed wages.

The financialization of the market - money being transfered from productive capital, to speculative activity, such as the trade on debt/derivitives ect.

Wage stagnation, due to the defeat of organized labor. Unlike the Keynsian era, wages under the neo-liberal regime do not rise in line with increased productivity.

In order for the aforementioned process to be enabled however, regulatory laws needed to be reformed and in many cases abolished, liberal ideology according to Harvey was utilized as the political justification for the enactment of capital/labor de-regulation. There existed a structural requirement to de-regulate the market and it was facilitated by a shift in political trajectory. This occured both within national governmental spheres and global regulatory bodies such as the IMF/WTO. Stiglitz summarizes that ''In the early 1980s a purge occurred inside the World Bank'' he continues to explain how after the appointment of Ann Kruger as chief economist in 1981 ''Free markets where seen as the solutions to the problems of developing countries''. In response to this shift towards neo-classical ideology many economists left the organization.

On the issue of poverty, one of the central questions concerning developmental economists, political theorists, anthropologists and sociologists alike is, does capitalist globalization of the post Keynesian era deliver on its own terms? Has the period of market liberalization provided an increase in the absolute living standards of the majority? The theoretical premise on which market liberalization was advocated held that liberal economic policy would invariably lead to higher productive output, more profits, cheaper goods and higher living standards. However some years on we see a very different picture having emerged as "The poorest group went from a per capita GDP growth rate of 1.9% annually in 1960-80, to a decline of 0.5% per year (1980-2000). For the middle group (which includes mostly poor countries), there was a sharp decline from an annual per capita growth rate of 3.6% to just less than 1%. Over a 20-year period, this represents the difference between doubling income per person, versus increasing it by just 21%." McKay p.329 (2007).

The structural adjustment programs imposed by the IMF and World Bank have in many cases exposed poorer nations to advanced competition through the maintenance of protectionist policies within the developed sphere. As conveyed by former Chief economist of the World Bank Joseph Stiglitz ''The western countries have pushed poor countries to eliminate trade barriers, but kept up their own barriers, preventing developing countries from exporting their agricultural products and so depriving them of desperately needed export income'' Stiglitz p.6 (2004) . Oxfam highlights in a 2003 report that ''in 2002, India paid more in tariffs to the US government than Britain did, despite the fact that the size of its economy was less than one third that of the UK - Bangladesh paid almost as much to the US government as France despite the fact that the size of its economy was only 3% that of France'' Chang p.75 (2007). The reality of neo-liberal policy is often hidden through the misrepresentation of figures and ''obscured by the observation that conditions have generally improved under the neo-liberal regime, or by resort to a concept of ''globalization'' that muddles export orientation with neo-liberalism, so that if a billion Chinese experience high growth under export oriented policies that radically violate neo-liberal principals, the increase in average global growth rates can be hailed as a triumph for the principals violated'' Chomsky p.217 (2007).

Additionally there exists the issue of increasing third world debt ''The debt of the developing world, for example rose from $580 billion in 1980 to 2.4 trillion in 2002. In 2002 there was a net outflow of 340 billion is servicing, compared to overseas development aid of $37 billion'' Harvey p.193 (2005). Repatriated profits expropriated from peripheral economies conjoined with massive outflows in debt service constitute a form of upward re-distribution indicative of the neo-liberal system. However although the process of upward re-distribution may have intensified under the post-Keynesian regime, it did exist prior to the shift in trajectory, albeit to a lesser extent - Zinn for example notes that US corporations between 1950 and 1965 ''in Latin America invested 3.8 billion and made 11.2 billion in profits, while in Africa they invested 5.2 billion and made 14.3 billion in profits'' McKay p.389 (2007). What is often called the ''anti-globalization'' movement is largely anti-capitalist, moreover it is more specificly opposed to ''neo-liberal globalization''.

Neo-liberal market reform has invariably resulted in the increased accumulative capacities of the global bourgeoisie, whilst weakening the working class within all spheres of production. It would be incorrect however to assume that Keynesian capitalism is consistent on an internal level. Employment was high under Keynesianism, so as a consequence of increased unionization - wages increased in line with productive output. Capital in response, offset costs in the form of increasing prices to the extent that aggregate demand declined and inflation increased. Inflation provided the justification required for the neo-liberal/monetarist ascendancy. Capitalism as a socio-economic system is wrought with an internal contradiction between its requirement to accumulate surplus value, and its capacity to generate it. This contradiction is both the cause of periodic crisis and the source of a vast productive and expansionary dynamic.

IBEC & Irish Labor Costs

There is a steady stream of propaganda being spread throughout the media at the moment in relation to wages. IBEC/FF are determined to push down the wages of ordinary workers. It is argued by the buisness community that Ireland has priced itself out of the labor market through the successive hikes in wage experienced throughout the celtic tiger. Cuts are whats needed in order to attract/retain investment, we should all be patriotic and take our ''hard medicine''. However, do IBECs assertions have any grounding in reality ?

Lets look at the facts:

Irish private sector wages are 1% below the EU-15 average and 14% below our peer group.

Irish manufacturing wages are 2% below the EU-15 average and 16% below our peer group.

Employers in Ireland pay the lowest social security contributions in the EU at 10%.

Public Holidays/Annual leave in Ireland is below the EU average.

Ireland's tax to GDP ratio is the 5th lowest in the EU.

This understood - Ireland is actually quite attractive with regards FDI, the notion that we are uncompetitive is a myth perpetuated by a social class who want to see an immediate profit at the expense of oridinary workers. There is in fact evidence to suggest that wage reductions will only make matters worse - seeing as it would lead to a decrease in consumer demand, cumulate in higher unemployment which in turn would cost the state more in terms of welfare payments/reduction in revenue. Furthermore, wages only make up 8-9% of total enterprise costs - so wage reductions wont make much difference in boosting exports. The price of capital goods has also fallen 1.7% year on year according the CSO. Capitalists might complain about rents ect. however there is nothing stopping the Gov from forcing landlords to drive down rents, instead of providing buisness with an excuse to offset its costs onto employees.

The notion that Irish labor costs are too high simpily has no bearing in reality, unfortunately this does not stop it being repeated throughout the media on a constant basis. The buisness community spew such propaganda in the hope that society as a whole will internalize it - accept reductions in their living standards and make parihas out of those dissedents who complain.

Sources:

EuroStat: Taxation and Customs Union

Michaeltaft - notes from the front.

Central Statistics Office

Book Review: Bad Samaritans (The Guilty Secrets Of Rich Nations) - Ha Joon Chang

This is a nice book - def worth a read. Chang sets out to expose how wealthy nations via the main financial institutions act to keep poorer nations in a condition of perpetual underdevelopment. This occurs in numerous ways - not least through the use of debt but also through the way in which trade policy is structured. Institutions such as the IMF make developing nations abolish subsidies on export goods ect. When developing industry within the third world becomes exposed to first world competition - it flatlines. Chang points out what may seem like the obvious ie. subjecting developing economies to the same rules as advanced economies doesn't create a level playing field. Not that this takes a genius to realize - but it does make you wonder why right wing economists have been ignoring the point for last few decades.

Ha spends a fair deal of the book de-constructing the historic mythology espoused by proponents of economic liberalism. Neo-liberals have a particularly nasty habit of arguing that developed nations (in the main) are prosperous due to their relatively low levels of regulation ect. The implication is that free trade = wealth, rainbows and happiness. http://www.heritage.org/Index/

However Chang refutes this argument - illustrating that the most developed nations advanced via massive regulation/protectionism, and only recently have many of them brought down their barriers. This stuff would be brilliant for pissing off Ron Paul supporters on US forums (not that I do that - i have a life...i swear). Additionally, he takes note of the fact that while developed nations may have low average protection - they disproportionately protect products that poor nations export - garments/textiles ect.

Interesting as a the book might be - Chang isn't a socialist. Despite his seething contempt for neo-liberalism, he remains grounded in the idea that capitalism can be reformed. He advocates something called the (infant industry argument) - essentially proposing that developed nations reduce all their barriers - and allow developing countries to engage in rampant protectionism. Fair trade on steroids is what comes to mind. He also seems rather taken with Keynsian style programs ect. In all what Chang stands for seems a fair deal more equitable than the current arrangement - but its still capitalism and as such is pre-disposed to crisis ect. Chang doesn't deal with the structural inadequacies of the system - nor does he highlight the fact that neo-liberal policy was the result of a periodic deficiency within keynesian capitalism (something I hope to discuss in a future post).

Capitalism and enviromental sustainability

If capitalism does not grow, through the increased production/sale of commodities and appropriation of resources both human and natural it will collapse. Each enterprise must, in order to stay afloat not only generate an increase in its net profit but see an increase in its rate of profit. Environmental considerations so long as they act to decrease the capitalist rate of profit will be averted - so for instance if the perceived risk of engaging in an act environmental degradation is calculated to be lower than the potential gain, then the company will pursue the more profitable course. While its often argued by proponents of ecologism that the former description of capitalist accumulation leads to a situation whereby capitalism is unable to function in an environmentaly sustainable manner - I consider this an over-simplification. It may be difficult for capitalism to overcome the problem of externalities as they pertain to the environment, however there are clear methods by which capitalist nations may address these issues.

The state could for instance, enact legislation whereby capital is unilaterally forced into accepting unprofitable costs where it refuses to act according to an ecologically sustainable framework. The problem presents itself however in the degree to which the state institutions are controlled by big buinsess/TNCs ect - who will in seeking preservation of short term profit margins resist such measures. Given the extent to which modern political parties are effectively sponsored by, and run by the rich, it is perhaps naive to conceptualize the state as being somehow less than an extension of immediate bourgeoisie interests. Even in the event that one particular state decided to enact such measures, they would likely become subject to an outward flight of capital - thereby forcing them to re-consider their policy.

This understood, progress in terms of ecological sustainability would most likely come about in the event that it proved a profitable endeavour. One possible event that could initiate this type of structural shift would be the depletion of the earths finite fuel reserves, this would invariably cause the cost of exploration to rise disproportionate to any return in the way of profit.

http://www.unido-ichet.org/ichet.org/fossil_fuels/a_finite_supply/assets/peak_oil2.png

This would likely incentivize capital to consider alternative forms of energy generation. However there is no guarantee that the alternative would be eco-friendly, in fact nuclear energy could conceivably be utilized as a profitable substitute. The degree to which renewable technologies can facilitate current production/consumption levels is debatable, for instance a study by the Stockholm environmental institute carried out in 1993 stated that ''renewables could supply 2.5 times the worlds current energy consumption in 2100, while up to 2030 the biggest contribution would be made biomass - but after that date the amount captured from the sun and the wind would rise rapidly'' Douthwaite 2000. However, in his book (the growth illusion) Douthwaite looks at alternate propositions, citing estimations made by another researcher - Trainer, explaining that ''in 1995 he concluded that renewables would not be able to sustain industrialized levels of world use'' - on biomass he stated that ''all energy stored each year in the earths plant mass is equal to approximately five times present world energy use''. As a result it would take all crop land in the world just to meet the present demand for transport fuel, adding that total biomass growth in the US would only provide 27% of its overall energy requirements'' Douthwaite 2000. An alternative economy of the deep green variety would likely entail either a substantial decrease in consumption, reduction in the population or both.

''Edward Goldsmith has put the global sustainability figure at 3,500 million'' Dobson 2000. In outlining how such reductions in population could be achieved through state mechanisms Dobson cites Irvines propositions that ''tax benefits for children with fewer than two children; sterilization bonuses; withdrawel of maternity and similar benifits after a second child; larger pensions for people with fewer than two children ect'' Dobson 2000. Irvine, nor Dobson however address the fact that the majority of the earths population live in the developing world, in areas where progressive taxation and pension funds are virtually non-existent. Moreover, these are the regions with the highest re-production rates, developed economies tend to have lower reproduction rates due to the availibity of social services ect. large families in the periphrial regions serve as a form of social security in the absence of any state supports.

http://upload.wikimedia.org/wikipedia/commons/thumb/7/7a/World_population_distribution.svg/400px-World_population_distribution.svg.png

Irvine then can only be taken to suggest that the developed world engage in redistribution of capital rather than lower actual production, however this assertion presupposes that the current levels of consumption be maintained. Additionally the notion that the global pop can be reduced by such a drastic amount seems outlandish. Even so, more realistic reductions would present massive problems.

To institue the type of state benifit scheems in periphrial economies that Irvine advocates would require substancial investment on the part of developed nations, either in the form of state aid or private donation in conjunction with some form of debt cancelation. This presents problem considering investment is largely dependent on profitability - so while the developed world may pay out large amounts to periphrial economies this is subject to the condition that the developing world provides an immdediate increase on the return. Zinn explaining the situation notes that while US corporations between 1950 amd 1965 ''in Latin America invested 3.8 billion and made 11.2 billion in profits, in Africa they invested 5.2 billion and made 14.3 billion in profits'' Zinn. Betsy Harmen also expressess the situation of the third world in the eighties as ''today giving more to the industrialized world than it takes. Inflows of official aid and private loans are exceeded by outflows in the form of repatriated profits, interest payments and private capital sent abraod by third world elites'' Bradford.

This understood the concept of an ecologicaly sustainible capitalism runs into problems to the extent that incentivising population reductions would undermine its own productive base. Expendature designed to decrease the mass of third world inhabitants would push up periphrial labor costs relative to returns thus causing a decline in the rate of profit and thereafter lead to economic stagnation. Again, capitalism runs into the problem of short term profitability vs long term collapse - it both requires an ever available mass of surplus labor to keep wage costs in check, while requireing an ever increasing market to buy up its goods.

While I consider it possible for capitalism to reduce its dependence on fossil fuels, I find capitalism (in the main) irreconsilable with ecological sustainability. Ecological sustainability would entail either a cap on consumption or a drastic reduction in the population. Each of the aformentioned tactics would require political policy to be put before the process of unhindered accumulation. Ecological sustainibility would require the mechanisms of trade be directed according to the targets of a political project. A green economy could not be based not on accumulation for its own sake - rather based on preservation and awareness of finite resources.

References:

Dobson A : (2007) Green Political Thought (Routledge:London) p.76 - 77

Harvey. A: (2005) Brief History Of Neo-Liberalism (Oxford) p. 175

Balken J: (2005) The Corporation - the pathalogical pursuit of profit and power (Constable:London) p. 33

Douthwaite R: (2000) The Growth Illusion (Lilliput Press: Dublin) p 223 - 224

McKay l: (2007) An Anarchist FAQ (AK Press:Edinburgh) p. 389